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January 2014

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Ring Of Fire Cools,
But Canadian
Prospects Are
Generally Hot
A Closer Look
Chromite mining in Northern Ontario – with epic potential –
isn't the country's one-hit wonder; resources and
infrastructure projects are smokin' all over.
TOM VAN DUSEN JR.
Northern Ontario's Ring of Fire may have cooled
off for the time being, but in several other areas of Canada
construction projects are looking hot, hot, hot right through
2014 and into 2015.
They'll heat up even more when Ring of Fire takes hold
again. All those with a stake in the mega mining venture
insist it's a matter of when, not if.
"Ring of Fire," is best known as a song made famous by
Johnny Cash, but in a remote part of Ontario, 250 miles
northeast of Thunder Bay, the borrowed title has also come
to identify what many predict to be one of the biggest
financial opportunities the province and perhaps the country
has ever seen.
It's the name given to a massive chromite mining and
smeltering project in the mineral-rich James Bay lowlands,
some 3,000 square-miles in all, centered on McFaulds Lake.
The tantalizing possibilities have attracted more than 35
mining and exploration companies to the area.
The nickname was bestowed by Sudbury lawyer turned
mining entrepreneur Richard Nemis who made the first
significant mineral finds in the area – apparently for no other
reason than he's a devoted Cash fan.
Ring of Fire stuck and now senior politicians such as
Canada's Treasury Board President Tony Clement are singing
the praises of the project. Clement claims the region could
become the economic equivalent of the Athabasca oil sands,
with potential for generating as much as $120 billion in
economic activity.
He adds that it represents a once-in-a-lifetime opportunity
to create jobs and long-term prosperity for Northern Ontario
and the nation. Clement has been looking to business, not
the federal government, to invest in the power and transportation infrastructure necessary to develop the deposit.
So far, so good! But let's not forget that it "burns, burns,
burns, the Ring of Fire."
Much of the infrastructure investment had been resting on
the shoulders of Cliffs Natural Resources, a U.S. international
iron ore and coal mining company, which, in November,
announced it is indefinitely ceasing participation in the
chromite project.
Cliffs decided not to allocate additional capital given the
uncertain timeline and risks associated with installation of
the infrastructure. It previously suspended the environmental
assessment process because of issues impeding progress.
By the end of 2013, Cliffs planned to reduce its project
team and close its offices in Thunder Bay and Toronto, as
well as the exploration campsite. The company emphasized
that it still believes in the value of mineral deposits and future
potential of the Ring of Fire and will continue to work with
the Ontario government, First Nations and other interested
parties to explore solutions related to the "critical issue" of
infrastructure.
Following Cliffs' estimated $3.3 billion pullout, some
analysts have described the project economics as "questionable at best."
"I went down, down, down, and the flames went higher,"
we hear Cash echo. Ontario Minister of Northern Development and Mines Michel Gravelle wasn't singing the tune
and didn't seem to feel the burn when he learned of Cliffs'
decision. On the contrary, he made a bold pronouncement
that the Ontario government would continue to work toward
success of the Ring of Fire.
(continued on page 48)
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